Healthcare Systems in America and Japan: Key Differences


Access to healthcare is an essential service that a nation must provide its citizens. Healthcare law and policy determine a population’s access to care, the quality of service, and the applicable financing options (Wilensky & Teitelbaum, 2019). In the U.S., healthcare delivery is a seriously debated issue, with different parties making multiple proposals to create an efficient system. The resource inputs in the U.S. include 5,500 hospitals with 900,000 beds, physicians, and nursing staff (Sezer & Bauer, 2017). In the Japanese context, the prioritization of healthcare service delivery has resulted in an effective system that offers quality care to the nation’s citizens. The resource inputs include human resources such as 273 physicians per 1000 people and infrastructure such as hospitals (Yokose & Jaya, 2020). The differences in healthcare delivery in the U.S. and Japan highlight the effects of political partisanship on service delivery.

Health System Features

The U.S. does not feature a uniform countrywide system as in the case of most other Organization for Economic Cooperation and Development (OECD) nations. The U.S. employs a hybrid payment structure that features varied insurance agencies working parallel to each other (Sezer & Bauer, 2017). The U.S. does not offer universal health coverage, as is the case in Japan. The choice of insurance coverage is impacted by a variety of factors such as age, geographical location, disability, and employment. The country’s service levels include public, private, and core safety-net providers. Core safety-net providers offer services to patients regardless of their ability to pay. The nation’s private and public insurance schemes differ in terms of benefits, sources of financing, and payments that are given to healthcare providers (Sezer & Bauer, 2017). The passage of the Affordable Care Act (ACA) led to a decline in the number of uninsured individuals, and it provided more options for healthcare service delivery.

Japan runs a publicly funded healthcare system that delivers services privately. The country has successfully transferred the insurance benefits to its citizens. Japan employs a universal health coverage system, which it first implemented in 1961 (Yokose & Jaya, 2020). The country’s service levels are divided into primary, secondary, and tertiary care institutions. Japan’s healthcare system is based on free access and compulsory public health insurance. In essence, every citizen is allowed to receive free consultations and treatment in any healthcare facility in the country, and each individual is expected to pay a small co-payment fee (Yokose & Jaya, 2020). Each individual makes insurance contributions depending on their job, which is believed to have contributed to Japan’s high ranking among OECD countries in a variety of categories (Yokose & Jaya, 2020). The current reviews indicate that Japan’s spending on health is below America’s average as a share of GDP.


Financing is an important aspect of healthcare in the U.S. The nation’s public services are financed by the Centers for Medicare and Medicaid Services (CMS), while private services are financed by private commercial insurance institutions (Sezer & Bauer, 2017). In 2013, healthcare costs amounted to 17% of the Gross Domestic Product (GDP), which was two times the average amount spent by other OECD countries (Sezer & Bauer, 2017). The country’s healthcare expenditure rate currently stands at 17.5% of GDP (Crawford et al., 2017). It is estimated that America spends approximately 1.3% more than it accrues from its GDP annually, meaning that by 2025, the nation will spend 20.1% of its GDP to finance healthcare (Sezer & Bauer, 2017). The resource inputs America uses for healthcare include the healthcare workers, land for facilities, and capital. The U.S. faces worse outcomes when compared to other developed countries. Its infant mortality rate is estimated at 6 deaths for every 1000 live births, and the life expectancy is at the age of sixty years (Sezer & Bauer, 2017). The implementation of the ACA has resulted in the creation of Accountable Care Organizations, which have significantly improved patient outcomes.

Japan faced numerous challenges concerning healthcare financing in the past. For instance, in the 1960s, the country’s overall expenditure on healthcare grew much faster than its GDP (Yokose & Jaya, 2020). The resource inputs Japan uses for healthcare include the healthcare workers, land for hospitals, and capital. It is estimated that healthcare costs accounted for 10.9% of the nation’s GDP in 2015, and only 11.7% of the total health spending was derived from out-of-pocket expenditure (Yokose & Jaya, 2020). In addition, nearly all of the nation’s citizens were covered under the country’s insurance scheme.

Patient Benefits

The U.S. has implemented the Triple Aim framework, which was designed to optimize the health system’s performance. Since its implementation, patients have had better experiences of care, and the cost of treatment has been marginally reduced. In addition, the overall population’s health has improved significantly (Sezer & Bauer, 2017). The passage of the ACA has increased the access to care for individuals who were previously denied insurance coverage. There is, therefore, no equity in terms of access to healthcare.

Patients in Japan have the freedom to choose the healthcare institutions in which they want to access services. In addition, the country’s healthcare system experiences very little political interference. The World Health Organization ranks Japan’s healthcare system as the seventh-best globally because of the quality of services delivered to patients and the extent of coverage the country offers its citizens (Yokose & Jaya, 2020). Patients in Japan do not need referrals to access services except in instances where they require secondary healthcare services. There is equity in the access to healthcare services in the country.


The biggest challenge facing the U.S. health system is the lack of access to care. It is estimated that 10% of the population, which is an estimated 29 million people, did not have insurance coverage in 2016 (Sezer & Bauer, 2017). As a result, the country recorded poor health outcomes, challenges in offering preventive care services, ineffective management of serious health conditions, and reduced life expectancy rates. The cost of insurance premiums in the U.S. is prohibitively high, meaning individuals opt to go without coverage.

Even though Japanese patients experience numerous advantages such as relatively low out-of-pocket payments, the rising number of elderly individuals and the increasing frequency of chronic diseases are putting a strain on the healthcare system. Other challenges include the diminishing fiscal space, a shrinking health workforce, and the rising cost of healthcare. There is a need to implement radical changes designed to address the aforementioned challenges. For instance, Japan has chosen to merge all insurance societies under a single umbrella body to increase efficiency. Japan’s dependence on private providers is challenging since some of the institutions apply expensive technologies and therapeutic options.


There are significant differences between the American and Japanese healthcare systems. For instance, while almost the entire Japanese population has access to universal care, a significant section of Americans do not have access to services. In addition, America spends more than its GDP on health financing, unlike Japan which spends less. Finally, Japan has better health outcomes compared to the U.S. despite the latter being a developed nation. It is vital to note that there is very little political interference with Japan’s healthcare system. It is evident that America’s political partisanship is to blame for the state of healthcare in the country.


Crawford, J. M., Shotorbani, K., Sharma, G., Crossey, M., Kothari, T., Lorey, T. S., Prichard, J. W., Wilkerson, M., & Fisher, N. (2017). Improving American healthcare through “clinical lab 2.0”: A project Santa Fe Report. Academic Pathology, 4, 1–8.

Sezer, M., & Bauer, F. (2017). An introduction to the U. S. health care system. In A. Schmid & S. Singh (Eds.), Crossing borders: Innovation in the U.S. healthcare system (pp. 11–28). Bayreuth.

Yokose, T., & Jaya, C. (2020). The transition and characteristics of Japan’s healthcare system. In Japan International Corporation Agency and the University of Japan.

Wilensky, S. E., & Teitelbaum, J. B. (2019). Essentials of health policy and law. Jones & Bartlett Learning.

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